CAB protest at banks coercing debtors into costly loans

by Gill Montia

Story link: CAB protest at banks coercing debtors into costly loans

The Citizens Advice Bureau (CAB) is continuing its campaign on behalf of British debtors with an attack on High Street banks, which it claims are putting pressure on customers who have financial problems to take out expensive loans.

According to the CAB, some banks are using aggressive and persistent tactics to persuade customers to take out such loans, against the advice of debt charities.

In some cases bank customers who have an agreed debt repayment plan, through a debt advice charity, are being coerced into taking out loans at interest rates that are higher than for their existing arrangements.

A CAB spokesman reported: “We see a lot of cases of people coming in who have tried to talk to their banks about arranged payments and they haven’t been listened to, and they have been asked for more than they can afford. Typically people find that, even after they have been dealing with us, they … have been continued to be written to. They get aggressive letters and phone calls from their lenders.”

The British Bankers’ Association (BBA) has confirmed that banks are happy to work with debt advice charities but points out that they have to make their own judgement about interest rates charged and how much someone can afford.

Eric Leenders from the BBA sums up: “The work that banks do with intermediaries like money advice trusts are essentially negotiations – they are not necessarily conclusive.”